On Thursday, February 5th, international gold prices encountered resistance and retreated, closing below the middle Bollinger Band, with bearish forces regaining dominance. As previously indicated, unless prices close above the 10-day moving average (around $5040), the trend is expected to remain volatile or potentially decline further.
In terms of price action, gold opened the Asian session at $4979.36 per ounce, reaching an intraday high of $5023.55 before facing resistance and falling. It found temporary support near $4790 around 11:00 AM but failed to gather significant upward momentum, maintaining a gradual downward trend through the U.S. session. The price hit a daily low of $4759.88 before settling at $4779.03, marking a daily range of $263.67. The session concluded with a loss of $200.33, a decline of 4.02%.
The downturn was influenced by resistance from moving averages and the CME Group's further increase in margin requirements for gold and silver futures. Additional factors included Ukrainian President Zelenskyy's comments about potential trilateral talks involving the U.S. and Russia, the European Central Bank holding its three key interest rates steady, a strengthening U.S. dollar index, Argentina's announcement of a trade agreement with the Trump administration, and the Iranian foreign minister leading a delegation to Oman for nuclear talks with the U.S. These developments collectively reduced safe-haven demand, putting further downward pressure on gold prices.
Looking ahead to Friday, February 6th, international gold opened with a gap up but quickly weakened, continuing to face pressure from the previous day's negative factors and selling pressure driven by a stronger dollar. However, the current bearish pressure primarily stems from liquidity-driven selling due to margin hikes and reduced buying interest from easing geopolitical tensions. These are considered short-term pressures. Following the bearish decline, a bullish rebound is anticipated.
On the data front, this week's ADP employment figures came in significantly below expectations and previous values, while initial jobless claims were higher than expected. This suggests that the delayed January non-farm payrolls report, now scheduled for February 11th, may also prove favorable for gold. Data releases to watch today include the preliminary U.S. one-year inflation expectations for February and the preliminary University of Michigan Consumer Sentiment Index for February, both of which market expectations suggest could support gold prices.
Furthermore, Federal Reserve officials have hinted at significant potential for interest rate cuts within the year, maintaining a positive outlook for gold in the coming weeks and months.
Despite this, the current bullish momentum remains weak, with support either insufficient or delayed. Short-term adjustment pressures persist, and the market may experience several months of volatile consolidation before resuming an upward trajectory.
From a technical perspective, on the monthly chart, despite February's sharp decline, gold found support at the level of the previously broken ascending trendline resistance (now acting as support) from January and rebounded. This suggests the broader bull market structure remains intact. Prices are expected to consolidate above this trendline support before strengthening again. Key support is observed around $4300; maintaining levels above this suggests potential for new bull market highs, while a close below could signal the end of the bull run.
On the weekly chart, last week's price action formed a bearish shooting star pattern after a rally. This week's price action is shaping up to be more of a doji or spinning top pattern, indicating indecision. This could signal bearish exhaustion, but bulls have not yet gained clear control, pointing towards continued volatility.
On the daily chart, the rebound encountered resistance at the 10-day moving average, and the price has fallen back below the middle Bollinger Band. Until a close above the 10-day MA is achieved, bears hold a short-term advantage, suggesting potential for further weakness. Bulls may look for support near the 30-day, 60-day, or 100-day moving averages for potential rebound opportunities. Resistance is seen at the middle Bollinger Band and the 10-day moving average.
For specific intraday trading guidance, refer to real-time account information.
Preliminary intraday trading levels for reference (specific entry/exit points subject to real-time account notifications): Gold: Support levels to watch are near $4680 or $4530; resistance is anticipated near $4845 or $4940. Silver: Support levels to watch are near $63.80 or $55.00; resistance is anticipated near $73.20 or $78.00.